Converting cash into cryptocurrency shouldn't feel like you're trudging through quicksand, uphill, in the pouring rain.
Cash to Crypto: A Beginner's Guide
Cryptocurrencies were built to be fungible, right? If only fiat currency wouldn't keep getting in the way of a more efficient medium of payment. Really, you shouldn't use one service as the be-all and end-all for your fiat conversion needs. You should have a wide array of options available at your fingertips so you can compare rates and get the best bang for your buck. With institutional investors finally pushing money into the sector, every hour counts.
In this step-by-step guide, I'll you exactly how to go from FIAT currency to trading and storing alt coins for short or long-term gain. Given the wide variety of services and scams, I'll break down the fee structure and help you avoid the exorbitant transfer and conversion fees. If you just care about the tables, click here for the funding comparison, and here for the exchange comparison.
Requirements:
- Method of converting Fiat Currency to Cryptocurrency (Fastest Option)
- Exchange account to purchase altcoins (Fastest Option)
- Email Address, ID Card
Step 1: Purchase cryptocurrency (LTC/ETH) with real-life currency.
Step 2: Open an Exchange Account
Step 3: Transfer funds into exchange wallets, begin trading
Step 4: Transfer to long-term storage
Step 1: Purchase cryptocurrency (LTC/ETH) with real-life currency.
This is where most people get caught up. If you pick the right service given your circumstances, you should be able to breeze through this with minimal work. It MIGHT take 24 hours before you'll be able to convert your fiat currency into LTC/ETH that you can trade. Do not fret, stick with it, if you put in 20 minutes of research and open a few different accounts, you will be able to get in on the markets very easily.
I've listed the 3 options I recommend below, but you can take a look at this link for my full comparison-
1. Coinbase - Sign Up!
Coinbase is one of the world’s premier cryptocurrency exchanges and wallet platforms allowing practically anyone to buy bitcoin, Ethereum, Bitcoin Cash and Litecoin. Once you have converted from FIAT, you can then easily transfer to the exchange of your choice.
Accepted Payments:
Fees: 3-5%
Features: Instant Deposit
Note: You can also transfer funds to their parent exchange, GDAX at no cost. I do not recommend this, as GDAX only has a few on the mainstream trading pairs and zero alt coins.
2. Coinmama - Sign Up!
Coinmama is one of the more popular bitcoin marketplaces out there, boasting over 200,000 customers and selling both bitcoin and Ethereum to verified users. Coinmama is a solid platform to buy your bitcoin or Ethereum with a credit card.
Accepted Payments: Credit/Debit Card
Locations: Global
Fees: 4-5%
3. Changelly - Sign Up!
Changelly offers a unique proposition: It allows you to exchange one cryptocurrency for another in the most convenient way possible. It does this by aggregating and suggesting the best rates directly on its website. Changelly’s robot is integrated into the world’s biggest cryptocurrency trading platforms, such as Poloniex and Bittrex.
Accepted Payments: Credit/Debit Card
Locations: 35 Countries
Fees: 1-2%
Other payment methods:
If you are interested in comparing other payment options, such as online bank transfers, PayPal, and cash deposits into bank accounts, check out my my full comparison here.
Step 2: Open up an Exchange account to start trading & Storing Alt-Coins
So you've got some Litecoin or Ethereum, that's great, now let's put it to work. The services I listed above are only used to convert fiat currency to crypto, now you need a way to buy some alt coins. You'll have to open up an account with a crypto exchange and transfer your LTC or ETH to that wallet in order to start trading. I listed out a few of the services I've enjoyed using, feel free to click this link to see the full comparison.
1. Binance - Sign Up!
Binance is a China-based cryptocurrency exchange that has been gaining momentum over the past few months. The platform gives users access to a robust set of trading tools, charts and security features. The exchange was created by experienced professionals in the cryptocurrency space, and the most recognizable name behind this project is that of Changpeng Zhao, former CTO at OKCoin.
Binance is known for its fast transaction processing as well as its low trading fees (0.1%). The Binance technology is capable of processing 1.4 million orders each second. This makes the platform a world leader in potential exchange volume.
Trading Pairs: 164 and growing
Locations: Global
Fees: 0.05% per transaction
Features: ICOs, Instant verify and trade, huge coin listing
HitBTC - Sign Up!
HitBTC is a global trading platform with multi-currency support, operating since 2013. The exchange has markets for trading digital assets, tokens and ICOs and provides a wide range of tools as well as stable uptime.The Platform development started with a 6 million euro venture investment agreement, as of the collaboration between software developers, finance professionals and experienced traders. The core matching engine is among the most advanced technological products in its class and implements innovative features such as real-time clearing, advanced order matching algorithms and has been acclaimed for its fault-tolerance, uptime and high availability.
Trading pairs: 160
Locations: Global
Fees: 0.10% per transaction
Features: High liquidity, No limits, low fees, high level of security
Changelly - Sign Up!
Changelly offers a unique proposition: It allows you to exchange one cryptocurrency for another in the most convenient way possible. It does this by aggregating and suggesting the best rates directly on its website. Changelly’s robot is integrated into the world’s biggest cryptocurrency trading platforms, such as Poloniex and Bittrex.
Trading Pairs: 233
Locations: 35 Countries
Fees: 0.10% per transaction + Network Fees
Features: Fund with FIAT currency via debit/credit, Instant Purchase, Easy Conversions
Step 3: Transfer funds into Wallets
Here's the easy part - the transfer. Regardless of which exchange account you opened up, the process is the same. You'll need to navigate to the "Wallets" section of your exchange (Binance, HitBTC, Changelly), and click the "Deposit" button next to LTC or ETH, whichever you initially purchased when you funded your account from FIAT currency.
You'll copy the deposit adress, go to your Coinbase or Coinmama account, click "Withdraw", and copy and paste the deposit address into that field. Select your amount, confirm the addresses are correct, click send, and you'll be on your way.
Step 4: Trading Alt Coins
The final step is the most fun! Now that you're exchange account has some ETH or LTC, you can start buying alt coins. You might need to convert your LTC or ETH into BTC before you can purchase the exact coin you want, but you can do that EXTREMELY cheaply on the exchanges.
After you buy your coins, you can hold them in the wallets on the exchange for as long as you want, or transfer them into long-term storage.
Thanks for reading! If you ended up using any of my links, shoot me a note and I'll hit you with a little tip to get you started. Good Luck!